Toyota Motor Corp has pushed back plans to build its Prius in the United States by as much as six years, with a top executive saying U.S. production is likely to start only when the best-selling hybrid is remodeled.

The world's largest auto maker had previously planned to produce the Prius at its new Mississippi plant but had put those plans on hold indefinitely as the financial crisis hit demand.

Last month, Toyota said it to would drop the Prius all together and instead build the Corolla sedan in Mississippi after local production of that model ended with the closure of a California factory formerly co-owned with General Motors Co.

The main components for the Prius such as the motor and battery are not mature enough for local production, Executive Vice President Atsushi Niimi said. We expect that they'll be ready with the next remodelling.

Niimi, who oversees production as well as regional operations in North America and China for Toyota, said the company would decide in due course where in the United States it would make the fourth-generation Prius, which is expected around 2016.

A more near-term concern was the pace of recovery in the U.S. market, which he said would likely be slow.

If you look at unemployment, housing, and other economic indicators there's not much good news. I think it will take time for the market to recover, he said, adding he did not share views that the U.S. market could recover to above 12 million units next year or to 14-15 million in 2012.

A slower-than-expected pickup in U.S. car sales has become a major worry for Japan's top automakers, which traditionally make the lion's share of their profits in North America.

Toyota also faces the urgent task of cutting costs and boosting manufacturing efficiencies in Japan, where it has enough facilities to build 3.9 million vehicles annually, compared with actual output of 3.2 million last year.

Toyota's production in Japan has soared over the past year, recovering from post-financial crisis levels with the help of generous government subsidies and tax incentives on fuel-efficient models.

But one of those schemes, providing subsidies to replace cars 13 years or older, ends in September, and automakers expect demand to shrink in Japan in the second half of the business year. Toyota is expected to be the hit the most because the Prius and other hybrids enjoyed the biggest perks.

Toyota has said it is aiming to make its domestic factory lines more flexible and introduce other changes to be able to break even at a dollar rate of 90 yen and capacity utilization of 70 percent, equivalent to daily production of 12,000 units.

We want to be able to reach this goal in about two years in Japan, Niimi said.

Shares in Toyota ended down 1.6 percent in Tokyo, in line with the transport equipment sub-index, taking its year-to-date losses to around 23 percent.

(Editing by Joseph Radford and Lincoln Feast)

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